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The ECB’s Secret Bailout Strategy

MUNICH – Why did Greece, Ireland, and Portugal have to seek shelter under the European Union’s rescue umbrella, and why is Spain a potential candidate?

For many, the answer is obvious: international markets no longer want to finance the “GIPS.” But that is only half true. In fact, international markets have not financed any of them to a considerable extent for the past three years; the European Central Bank has. The so-called “Target” accounts, hitherto ignored by the media, show that the ECB has been much more involved in rescue operations than is commonly known.